Mercari (4385) AI Stock Analysis

• Market Cap: $390.88B
• Dividend Yield: N/A
• Average Volume (3M): 4.41M
• Price to Earnings (P/E): 24.2
• Beta (1Y): 0.70
• Revenue Growth: 3.01%
• EPS Growth: -2.84%
• Country: JP
• Employees: 2,080
• Sector: Consumer Cyclical
• Sector Strength: 65
• Industry: Specialty Retail
• EPS (TTM): 26.47
• Shares Outstanding: 164,509,860
• 10 Day Avg. Volume: 3,380,460
• 30 Day Avg. Volume: 4,405,770
• PEG Ratio: 32.37
• Price to Book (P/B): 4.71
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 160.25
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $2,976.38
• Price Target Upside: 25.30% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 64 Neutral
• Price Target: ¥2,592.00 ▲(9.11%Upside)

Mercari's strong financial performance is the most significant factor, supported by healthy profitability and growth metrics. However, weak technical indicators and moderate valuation reduce the overall score. The absence of dividend yield and lack of current earnings call data limit additional insights.

Mercari Business Overview & Revenue Model

Company Description

Mercari, Inc. engages in the planning, development, and operation of the Mercari marketplace applications in Japan and the United States. Mercari, Inc. was incorporated in 2013 and is based in Tokyo, Japan.

How the Company Makes Money

Mercari generates revenue primarily through transaction fees charged to sellers on its platform. When a user sells an item, Mercari takes a percentage of the sale price as a commission. Additionally, the company offers optional promotional services to sellers, such as listing upgrades and enhanced visibility for their products, which provide additional revenue streams. Mercari also benefits from partnerships with logistics providers for shipping solutions, further facilitating the buying and selling process. The company's earnings are significantly influenced by the volume of transactions on its platform and its ability to attract and retain active users.

Mercari Financial Statement Overview

Summary

Mercari's financial performance is strong, with high profitability margins and steady revenue growth. The income statement highlights efficient cost management and improved profitability, although cash flow metrics indicate a need for better operational cash generation.

Income Statement

Mercari has shown a solid performance in its income statement metrics. The TTM (Trailing-Twelve-Months) gross profit margin is strong at 70.9%, indicating efficient cost management relative to revenue. The net profit margin improved to 8.6%, reflecting increased profitability. The revenue growth rate from the previous year is 1.7%, indicating steady growth. The EBIT and EBITDA margins are notable at 13.2% and 14.3%, respectively, showcasing operational efficiency. Overall, the income statement reflects healthy profitability and growth, with room for further revenue expansion.

Balance Sheet

The balance sheet of Mercari demonstrates a stable financial position. The debt-to-equity ratio is 2.14, suggesting moderate leverage but well within a manageable range. The return on equity (ROE) stands at 19.4%, highlighting effective use of equity to generate profits. The equity ratio is relatively low at 16.2%, indicating a higher reliance on liabilities to finance assets. While the company maintains a strong cash position, improving the equity ratio could enhance financial stability.

Cash Flow

Cash flow metrics for Mercari present a mixed picture. The free cash flow growth rate reflects a significant recovery from previous negative levels, indicating improved cash generation. The operating cash flow to net income ratio is 0.17, suggesting that operating cash generation needs enhancement relative to profits. However, the free cash flow to net income ratio of 0.15 underscores a positive trend in converting earnings into free cash flow. Focus on strengthening operational cash flows could improve the cash flow position.

Breakdown	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	187.41B	171.97B	147.05B	106.11B	76.28B
Gross Profit	129.73B	114.42B	95.14B	81.80B	55.61B
EBITDA	20.42B	17.96B	-3.04B	13.06B	-18.63B
Net Income	13.46B	13.11B	-7.57B	5.72B	-22.77B
Balance Sheet
Total Assets	501.77B	415.29B	339.86B	262.53B	198.01B
Cash, Cash Equivalents and Short-Term Investments	197.31B	202.05B	211.41B	171.46B	141.01B
Total Debt	193.31B	157.53B	131.35B	71.15B	52.45B
Total Liabilities	429.63B	360.06B	301.87B	222.52B	162.65B
Stockholders Equity	71.84B	54.67B	37.68B	39.63B	34.78B
Cash Flow
Free Cash Flow	-43.49B	-37.35B	-26.89B	2.95B	11.76B
Operating Cash Flow	-43.34B	-36.88B	-26.22B	3.37B	12.53B
Investing Cash Flow	-877.00M	-601.00M	-671.00M	6.91B	-2.65B
Financing Cash Flow	32.09B	25.17B	62.06B	19.77B	465.00M

Mercari Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2375.50
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4385, the sentiment is Negative. The current price of 2375.5 is below the 20-day moving average (MA) of 2582.13, below the 50-day MA of 2510.37, and above the 200-day MA of 2240.88, indicating a neutral trend. The MACD of -31.82 indicates Positive momentum. The RSI at 39.79 is Neutral, neither overbought nor oversold. The STOCH value of 11.94 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4385.

Mercari Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4385	64 Neutral	$390.88B	24.17	21.33%	―	3.01%	-2.84%
Sector *	62 Neutral	$16.98B	10.86	-7.08%	3.03%	1.73%	-25.18%
RKUNF	―	$11.44B	―	-22.97%	―	―	―
MONOF	―	$9.17B	38.85	28.00%	<0.01%	―	―
SATLF	―	$9.02B	30.70	48.74%	2.37%	―	―
7685	73 Outperform	¥87.23B	24.83		1.05%	56.13%	124.78%
3964	69 Neutral	¥80.10B	15.18		2.56%	29.11%	8.08%

Mercari Corporate Events

Mercari Reports Strong Profit Growth Amid Modest Revenue Increase

Mercari, Inc. reported its consolidated financial results for the nine months ending March 31, 2025, showing a modest increase in revenue by 2.3% compared to the previous year. The company achieved significant growth in core operating profit and operating profit, with increases of 48.7% and 58.9% respectively, indicating improved operational efficiency. The financial position of the company also strengthened with an increase in total assets and equity, reflecting a stable financial outlook. Despite the positive financial performance, the company maintained a policy of not issuing dividends for the fiscal year.